The U.S. has a fragmented policy for dealing with long-term care needs. Medicare, the health insurance program for the elderly and disabled, covers acute medical care and very limited nursing home care as long as it's linked to a hospital stay. Federal Medicare rules allow coverage if:

• a patient has a prior hospital stay of at least three days and is admitted to a nursing home within 30 days of discharge for the same condition;

• the patient requires daily skilled nursing or rehabilitation services;

• the nursing home is Medicare certified; and

• a medical professional certifies that skilled nursing is needed.

Home Care Services

Medicare does cover home care services as long as they are "medically reasonable and necessary." That means coverage applies for the services of skilled nurses, home health aides, medical social workers, and physical and occupational therapists. Medicare also will cover the full cost of some medical supplies and 80 percent of the approved amount of durable medical equipment such as wheelchairs, hospital beds, oxygen supplies, and walkers.

Medicare pays for home care when a patient requires intermittent skilled nursing care, physical therapy, or speech pathology, under the following conditions:

• a patient is confined to his or her home;

• the doctor determines that home care is necessary and sets up a plan for receiving care; and

• the home health agency participates in Medicare.

Although most Americans think of Medicaid as the health program for poor welfare mothers and children, 44 percent of the program's outlays are for long-term care. Medicaid picks up about half the nation's $70 billion nursing home bill. Private insurance accounts for about 2 percent of that bill. Two of every three nursing home residents receive assistance from Medicaid; most are elderly.

About 14 percent of residents who enter nursing homes pay the cost themselves and end up qualifying for Medicaid within a year after spending their entire net worth. To become eligible for Medicaid, a married couple must exhaust their life savings. In most states, nursing home residents cannot receive Medicaid coverage until they have less than $2,000 in liquid assets (this does not include a house). Spouses who remain in the community like Mary Webb are entitled to keep a minimum monthly allowance and a minimum set of assets up to a capped amount.